2017 Sustainability Report
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Ferrari N.V. SUSTAINABILITY REPORT 2017 Ferrari N.V. Official Seat: Amsterdam, The Netherlands Dutch Trade Registration Number: 64060977 Administrative Offices: Via Abetone Inferiore 4 I- 41053, Maranello (MO) Italy Ferrari N.V. SUSTAINABILITY REPORT 2017 2 Table of contents Letter from the Chairman and Chief Executive Officer 05 A 70-year journey to sustainability 09 Ferrari Group 13 About Ferrari 13 Our DNA 14 Our Values 15 Our Strategy 15 Our Business 17 Sports and GT Cars 17 Formula 1 Activities 29 Brand Activities 30 Materiality Matrix of Ferrari Group 32 Stakeholder engagement 36 Our governance 39 Sustainability Risks 43 Product Responsibility 47 Research, Innovation and Technology 47 Client Relations 53 Vehicle Safety 60 Responsible Supply Chain 63 Production process 64 Conflict minerals 67 Our people 69 Working environment 69 Training and talent development 73 Occupational Health and Safety 77 Our employees in numbers 79 Our Environmental Responsibility 85 Plants and circuits 85 Vehicles environmental impact 94 Economic value generated and distributed 103 Ferrari contributes towards the community 105 Ferrari & universities 105 Ferrari Museum Maranello & Museo Enzo Ferrari (MEF) 106 Scuderia Ferrari Club 106 Ferrari Driver Academy 108 Methodology and scope 111 GRI content index 113 Independent Auditor’s Report 124 3 Letter from the Chairman and Chief Executive Officer Dear Shareholders, 2017 marked Ferrari’s 70th Anniversary. We were surprised and delighted by the enthusiasm and the extraordinary turnout, with tens of thousands of clients and fans participating in the yearlong tour of celebrations all over the world. Events were held in over 60 different countries, providing a truly vivid and unforgettable display of the brand’s power. We had one more reason to celebrate, as 2017 was another year of new fantastic models and a very good, solid financial performance. We continued our growth, offering the widest range of products ever, without compromising on our fundamental principles of exclusivity and leading technological innovation. We launched three new cars, designed to meet the requirements of very diverse clients: the 812 Superfast, our most powerful and fastest road model ever, the Ferrari Portofino, which tops our V8 GT range, and the FXX K Evo, a track-only “laboratory car” unveiled at the Finali Mondiali in Mugello. We won the International Engine of the Year award, for the second consecutive year. This is an important acknowledgement of our leading-edge technology as it is one of the most sought-after plaudits in the car industry. The award was won by the 3.9-litre V8 power unit from the 488 family, for the new benchmarks it set in the turbo engine segment. We are, of course, just as determined to create equally impressive hybrid engines for the Ferraris of the future. In 2018 we will lay the groundwork of our future strategy, which will include hybrid technology as well as new models designed to meet the needs of a GT group of customers, which have not been fully addressed yet. In doing so, we will stay true to our strong DNA, ensuring that, whichever technology we use, we will always provide our customers with a unique driving experience, as Ferrari has always done. On the financial results side, Ferrari ended 2017 with a new record. Two years on from the listing on the U.S. and Italian stock markets, we can confirm that we have not only kept our promises but in certain instance exceeded our own plans. Our adjusted EBITDA grew to over a billion euro, with a margin of 30.3%, two years ahead of the IPO business plan. To mention just a couple of key figures, in 2017, we delivered 8,398 cars, an increase of 4.8% on the previous year, while revenues rose by 10% to 3.4 billion euro. We delivered equally important results on the sustainability front in 2017. Among our many social and environmental achievements and milestones, I am particularly proud of the work we did to help our staff develop their potential, as 5 Letter from the Chairman and Chief Executive Officer we truly believe our employees are a vital source of innovation. In 2017 we provided our workforce with over 35,500 hours of training. That investment was rewarded by the 7,600 suggestions our production staff submitted to help us improve our products and processes. Our commitment to sustainability includes naturally a constant reduction of CO2 emission for our models. Ferrari takes its role as an active member of society extremely seriously and decided to make a particular contribution to good causes in its 70th Anniversary year. In September, we donated an exclusive LaFerrari Aperta to Save the Children. Save the Children raised 8.3 million euro, which will be used to provide access to education for thousands of the most vulnerable children across all five continents. We sealed new licensing agreements in the course of the year, something we will continue to do with great caution, as we are conscious of the importance of protecting the brand’s value. We have just started our path and there is still a lot to do. Last but not least, our sports activities: we had a season with some satisfaction, but also a few regrets. On the GT side, it proved an exceptionally rewarding year crowned by both Constructors’ and Drivers’ titles in the FIA World Endurance Championship. The Formula 1 World Championship taught us a big lesson, we were proud to return to the circuits as protagonists and with a single-seater well up to what seemed like an impossible challenge even as the first grand prix approached. Unfortunately, it still was not quite enough, but we are now more determined than ever to compete in the upcoming Championship - and many more to come - without betraying the true essence of the sport. I would like to conclude by thanking you - our valued shareholders - who flanked us along the way and spurred us to grow. We reiterate to you and all our stakeholders our commitment to living up to the Ferrari legend worldwide each and every day. February 23, 2018 Sergio Marchionne Chairman & Chief Executive Officer 6 Letter from the Chairman and Chief Executive Officer 7 Letter from the Chairman and Chief Executive Officer A 70-year journey to sustainability Ferrari has always put people and their passion at the centre of all its processes and involvement in motorsport, starting with our employees and their families then extending outward to our clients and the community as a whole. In 1990s, we embarked on the Formula Uomo programme which has changed the whole look and fabric of the factory complex. Ferrari’s production facilities are designed and built around the workers’ well-being, thanks also to the advanced technologies for functional and ergonomic working, and to the highest eco standards of the buildings up to the new net zero energy protocols, not to mention the 25,000 plants on campus, with trees and gardens around every corner. By deliberately fostering a culture of safety, leading-edge technologies and sustainability, Formula Uomo has created a workplace that allows the talents of all of our employees to be expressed in our cars of excellence. Ferrari provides over 35,500 hours of employee training per year and this is a source of huge innovation. In fact, we consider it the most strategic of our investments. Our commitment has been fully reciprocated by our employees who, in 2017 alone, submitted 7,600 suggestions as to how products and processes could be improved. Employees’ families too are included in a vast programme of services and opportunities, not least the free medical check-ups delivered last year as part of Formula Benessere (Formula Well-Being). We also have various agreements and subsidies in place to assist with academic studies and leisure pursuits. Children in particular can have consultations with doctors in areas such as sport orientation and can attend the “Formula Estate Junior” Summer Camp. Our clients benefit directly from the improved workplace environment, boosted process efficiency and technological innovations – from the Ferrari world in other words. Clients are the backbone of the business and our best advertisement for the integrity and success of our brand, through strict quality control and the continued training and support for our dealers’ services. When clients purchase one of our cars, they are invited to experience the exhilaration of driving as part of a community by participating in a rich calendar of events that will also enhance their loyalty to the brand. The results have been impressive: in 2017, 66% of our new cars were sold to Ferrari owners, while 32% of clients own more than one Ferrari. 9 A 70-year journey to sustainability This is how Ferrari has become part of both society and its heritage, working to reduce environmental impact in a sphere that stretches out from Maranello to over 60 different export markets. Our sustainability takes concrete form, for instance, in a trigeneration plant which met 86% of our energy requirements in 2017, while the remainder was generated from renewable sources like our photovoltaic system. We also follow a waste reduction policy in line with the circular economy concept. Most of all, we are working on an ambitious hybrid technology research project designed to cut our cars’ emissions by 15% between 2014 and 2020. Ferrari aims to use this first Sustainability Report to continue on a path that in reality, it has been treading since its foundation, from a time when economic growth began keeping pace with social and local area development. Today, as then, enhancing the qualities and passions of individuals to the greatest possible extent consistent with our philosophy of teamwork is the Ferrari way of winning both on the world’s markets and circuits.